Client Has No Standing in Attorneys’ Fee Dispute

     RICHMOND, Va. (CN) – A former Virginia inmate who received what is purported to be the largest prisoner’s rights settlement in state history has no standing in an ongoing attorneys’ fees dispute arising from the case, a federal judge ruled last week.
     Stefan Woodson had just one month to go on a six-month sentence for assault on a Virginia Commonwealth University security officer when he suffered a near fatal heat stroke at the Old Richmond City Jail on July 9, 2012.
     At the time, much of the United States was gripped by historic triple-digit temperatures. According to the National Climatic Data Center, daily record high temperatures where set in thousands of locations in both the United States and Canada in June and July 2012, including a temperature of 105 degrees in Washington D.C. on July 7 – the highest temperature ever recorded in the nation’s capital.
     In a complaint filed in March 2013, Woodson said he housed on the medical tier of the old jail — allegedly its hottest location — and he claimed deputies knew of his heat illness symptoms, but failed to monitor his temperature.
     He said by the time he was taken to the hospital, his core temperature had reached over 108 degrees, and he had suffered permanently debilitating injuries. In March, the City of Richmond settled Woodson’s lawsuit, agreeing to pay him $2.99 million.
     But then, things got complicated.
     Woodson’s original lawsuit had been filed by Seth Carroll and Benjamin Andrews who were then associates in the law firm, Geoff McDonald & Associates, P.C. But on January 14, 2014, Carroll, Andrews and five other GMA attorneys left the firm en masse.
     Carroll and several of the departing attorneys then formed their own firmed, Commonwealth Law Group, while Andrews joined The Halperin Law Center.
     Woodson, who had previously signed contingency fee agreement with GMA, did so again with each of attorneys’ new firms.
     On February 6, 2014, FMA sent a Notice of Lien for attorneys’ fees to David Corrigan, who represented the city against Woodson. The letter requested
     that “100% of any and all attorney’s fees and costs advanced be sent directly to Geoff McDonald and Associates so that the same may be apportioned according to an employment contract between this firm and the departing attorney (Seth
     Carroll).”
     When the parties settled Woodson’s lawsuit on February 13, 2015, GMA sent the notice of lien to everyone involved in the case. Then, on April 6, 2015, GMA filed a complaint against Woodson’s lawyers and their firms in the Circuit Court of Henrico County.
     This prompted Woodson to file a motion in Federal Court, arguing that he would be injured, emotionally and otherwise, if attorneys’ fees from his settlement were not paid in their entirety to the lawyer of his choice.
     On May 13, Senior U.S. District Judge Robert Payne tossed Woodson’s motion, ruling that the former inmate simply has no financial stake in the outcome of the fee dispute.
     “To begin, GMA has represented that it ‘claims no entitlement to the settlement funds paid to Woodson (or to be paid to Woodson), only to his lawyer’s fees,'” Payne wrote. “… GMA contends that Woodson will receive the exact same amount of money under the settlement agreement without regard to the resolution of the dispute between GMA, its former associates, and Halperin.
     “Woodson does not say otherwise. Nor could he because Woodson has received either directly, or through the annuity trust provided in the settlement agreement, all of the funds to which he is entitled under the settlement,” the judge said.
     Payne noted that “Thirty-nine percent (39%) of the settlement amount was withheld and, the Court is told, is now in escrow.
     “That represents the contingent fee called for by the retainer agreement between Woodson, Halperin and Carroll. And, under that retainer agreement, the lawyers have agreed to indemnify Woodson against the difference between the thirty-nine percent (39%) fee called for by that agreement and the forty percent (40%) fee called for by the agreement between Woodson and GMA,” he wrote. “Thus, on this record Woodson has no financial stake in the resolution of the fee dispute between the lawyers. Therefore, he will sustain no injury in fact no matter how that dispute is resolved.
     “In sum, Woodson has failed to meet the ‘injury-in-fact’ component of the standing test. For that reason, his motion must be denied,” Payne said, adding that even if Woodson had established standing, “the Court nonetheless would decline to exercise supplemental jurisdiction … because there is no nexus between Woodson’s federal civil rights claim that affords subject matter jurisdiction in this case and the fee dispute between the lawyers which is a matter of State contract and tort law.”

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